Treasurer Joe Hockey delivers the Mid-Year Economic and Fiscal Outlook at the National Press Club.

Treasurer Joe Hockey delivers the Mid-Year Economic and Fiscal Outlook at the National Press Club. Photo: Alex Ellinghausen

There's nothing particularly remarkable about the political strategy of the government's economic strategy. The last lot made a big mess: a Coalition government, as so often it must after Labor profligacy, is setting about putting things right again.

The more dire the mess Treasurer Joe Hockey can claim to have discovered, the more discredited the former government should be; the more empowered Hockey is about taking the drastic action necessary to wrestle the economy back into order. Including perhaps dropping of some inconvenient promises - perhaps even the taking up of some agendas the existence of which had been denied.

Yet it's not a policy without risk. Hockey was asked on Tuesday whether his very portrait of an economy and a government fiscus in trouble might not seriously affect consumer confidence in the last week before Christmas. He remarked, quite reasonably, there was such a risk, but that there was hardly ever a right time; he would have been equally criticised had he left it until the new year, with many journalists away. Likewise, there were always pressures to bring such statements forward.

It is unfair to criticise him for the timing; indeed it probably ill-suits his interest. The political season is quickly closing as most Australians are preparing for Christmas, for holidays, for a season of sport and loafing around, and for some blessed relief from an uncommonly long and unpleasant political campaign which, a few months ago, led to a change of government.

Hockey has a big message to sell - but he is trying to sell it at a time when the population is hardly listening. It's not, primarily, a problem that Labor - the now opposition - vehemently rejects the charges made against it, and putting other interpretations into the system. Most likely the public is not much listening to them either; at best, from Labor's point of view, the public might mentally note the plea of not guilty.

Any messages planted are in shallow and sandy soil: the set of images, impressions and ''truths'' adopted by the population at large may not be enough to provide that empowerment or authorisation for what the government says is necessary. The government does not have this problem with its committee of audit, which, from its own point of view is a fairly tame group of sympathisers who can be more or less relied upon to say whatever the government wants said at the time. Strictly that time is only a month away - though that does not necessarily mean the political powers that be are yet certain about what it should say.

It is by no means necessarily problematic if there is little public scrutiny of its deliberations, or detailed examination of its policy prescriptions, at least so long as Hockey and Abbott have rammed home, with Tuesday's evidence, the proof the last tenants wrecked the joint. A certain mood of crisis, hard choices, and grim duty is a necessary backdrop for the audit, but the audit itself, being intensely political, can hardly create the mood.

Indeed, as with helpful, but somewhat enthusiastic policy suggestions from groups such as the Institute of Public Affairs, it may help if the audit makes some strong proposals - about, for example, wholesale privatisation of public bodies, or closure of agencies - which the government is seen to reject as being a bit extreme, even in difficult circumstances.

Yet there are some senses in which it may well suit Abbott and Hockey down to the ground if the political and economic argument over the new few months, leading up to the budget in May, is about whether or not Labor was too optimistic in its revenue projections or about its capacity to restrain costs, whether guesstimates about out years are to be regarded as reliable, or whether and to what extent Hockey and his Finance Minister, Mathias Cormann (or their ministerial offices or their departments) have cooked the books by loading into them things that have happened since the change of government, including the practical effect of spending decisions made by the Abbott government. [By contrast, of course, the government insists, rightly enough, that the previous government had made inadequate provision for inevitable and certain expenses, such as the likely costs of ultimate Gonski deals with states such as Queensland and Western Australia.]

This is an argument, with tidbits of evidence on either side, which can rage indefinitely to obscure more sensible debate about the degree to which the economy is deteriorating, the general action which ought to be taken by any government in response to the changes, and what, if anything, these mean in terms of the fiscal levers, including matters such as budget deficits or targets about getting the budget into surplus.

This is because the real argument is no longer about how much Labor trashed the joint, or how harsh the medicine should be in order to meet the requirements of some shibboleth about budget balances. It is as much about the fact that this government now accepts, in a way it did not before, that old budget fundamentals are changing fast, that government revenue has been declining much more quickly than anyone expected, and that government cost control is proving very difficult, not least as some automatic and some conscious counter-cyclical mechanisms are kicking in to sop up unemployment or regional recessions.

Labor and Liberal can argue all they like about whose actions were responsible for the decisions of Ford or Holden, and now probably Toyota, to cease manufacturing, but much more important is government must consider how it is going to deal with the problems this causes. Will it do so by pump priming, job creation programs, special concessions to encourage business ventures, local confidence and regional demand? Will it want to be purist - as some of the Commission for Audit might be inclined to think - by wanting the ''market'', including some hard realities on the bargaining power of organised labour, to solve the regional problems?

These are questions any government, and any politicians - and Abbott and Hockey are practical politicians rather than reflex ideologues - must consider not in some abstract context - or even in a conclave with Treasury and Finance advisers - but against a background of an unexpected Senate election in Western Australia, a by-election in Queensland, a state election in South Australia and an inherently unstable Victorian coalition government. And, indeed, against a backdrop of a potential double dissolution in the second part of next year - after any horrors the budget might bring.

Bearing this in mind, what one notices about Tuesday's statement is not so much the effort to blame Labor, but the fact that the Coalition has abandoned most of its own old prescripts and that economic management has become much as it was under the previous government. Whether in relation to debt, or deficit shibboleths. In effectively dropping plans for wholesale cuts to the public service. In trying, in short, to control and manage an economy it by now owns.

Hockey may say he is relishing the task before him - but the mode he is in is not in following Peter Costello in his early day, but Howard in the Fraser days, or Howard from the time - say 2000 - when his power and influence over Treasury and the then treasurer meant that politic pragmatics, not doctrinaire economic points, won the day. Some people forget that by 2007 it was Labor which was complaining of Coalition profligacy.

In such a context, it is remarkable, incidentally, that none of the guardians, appointed or self-appointed, of public service neutrality, seem to have protested against Hockey's verballing of some senior public servants last week. It was, of course, in question time under the indulgence of Bronwyn Bishop, after a fake Labor point of order pointing out that the estimates of the pre-election fiscal outlook had been made by the secretaries of Treasury and Finance, not by Labor ministers, and that thus, suggesting PEFO were cooked reflected upon these public servants.

Hockey: ''I do not think there were two people more relieved at a change of government than the Secretary of the Treasury and the Secretary of the Department of Finance: 'Phew, what a relief! We've got rid of that mob!'"

I bet they didn't actually say that - to Joe Hockey, at least.